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Atlanta based HomeBanc has sold off part of their mortgage business to Countrywide Financial Corp. and is closing the rest. The company decided the risks of mortgage lending are not worth the possible benefits. HomeBanc has 42 thousand loans on their books that they will continue to service, but they will not be writing any more loans.

Another hit for the mortgage industry.

HomeBanc will continue to service existing loans and the change should have little or no affect on HomeBanc’s more than 42,000 mortgage holders.Still, with the scale-back, HomeBanc becomes another domino in a cascade of failures and cutbacks in the teetering mortgage industry. The impact has roiled the economy, upset stock markets and made buying or selling a house a lot harder.
As lenders nationwide fight off the impact of easy credit policies of recent years, delinquency rates and foreclosures have soared. Georgia’s delinquency rate is eighth in the nation.
The announcement comes a day after American Home Mortgage, once one of the nation’s biggest lenders, filed for Chapter 11 bankruptcy protection. Also on Monday, two other large mortgage firms in Houston and Cleveland said they were suspending new loan applications.HomeBanc lent about $5 billion for home purchases in 2006, primarily in Georgia and Florida. via  ajc.com.

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